INCOME TAX ASSESSMENT ACT 1936

So far as a provision of the
Income Tax Assessment Act 1936
gives an expression a particular meaning, the provision does
not
also have effect for the purposes of the
Income Tax Assessment Act 1997
(the
1997 Act
), or for the purposes of Schedule
1
to the
Taxation Administration Act 1953
, except as provided in the 1997 Act or in that Schedule.

5 Application provisions
…
Rebate for medical expenses
(8)
The amendments apply in relation to working out whether a taxpayer is entitled to a rebate of tax, and the amount of the rebate, under section
159P
of the
Income Tax Assessment Act 1936
in respect of a year of income beginning on or after 1 January 2017.
Rebate for low income aged persons and pensioners
(9)
The amendments apply in relation to working out whether a taxpayer is entitled to a rebate of tax under section
160AAAA
of the
Income Tax Assessment Act 1936
in respect of a year of income beginning on or after 1 January 2017.
(10)
The amendments apply in relation to working out whether a trustee is entitled to a rebate of tax under section
160AAAB
of the
Income Tax Assessment Act 1936
in respect of a year of income beginning on or after 1 January 2017.
Dependant (invalid and carer) tax offset
(11)
The amendments apply in relation to working out whether an individual is entitled to a tax offset, and the amount of the offset, under section
61-10
of the
Income Tax Assessment Act 1997
for an income year beginning on or 1 January 2017.
Dependant (non-student child under 21 or student) notional tax offset
(12)
The amendments apply in relation to working out the amount of an individual
'
s notional tax offset under Subdivision
961-A
of the
Income Tax Assessment Act 1997
for an income year beginning on or 1 January 2017.

The definition formerly read:

of a taxpayer for a year of income is the amount worked out using the formula:

Taxpayer
'
s reportable
fringe benefits total

×

(1
-
FBT rate)

where:

FBT rateis the rate of tax set by the
Fringe Benefits Tax Act 1986
for the FBT year (as defined in the
Fringe Benefits Tax Assessment Act 1986
) beginning on the 1 April just before the start of the year of income.

Definition of
"
adjusted fringe benefits total
"
inserted by No 27 of 2009, s 3 and Sch 3 item 1, applicable in relation to income years starting on or after 1 July 2009.

adjusted taxable income for rebatesmeans adjusted taxable income (within the meaning of the
A New Tax System (Family Assistance) Act 1999
, disregarding clauses
3
and
3A
of Schedule
3
to that Act).

agent: this Act applies to some entities (within the meaning of the
Income Tax Assessment Act 1997
) that are not agents in the same way as it applies to agents: see section
960-105
of the
Income Tax Assessment Act 1997
.

119 Transitional provision relating to agents
119
A declaration in force for the purposes of paragraph (b) of the definition of
agent
in subsection
6(1)
of the
Income Tax Assessment Act 1936
immediately before the repeal of that definition continues to have effect on and after that repeal as if it were a determination under subsection
960-105(2)
of the
Income Tax Assessment Act 1997
.

The definition formerly read:

agentincludes:

(a)
every person who in Australia, for or on behalf of any person out of Australia holds or has the control, receipt or disposal of any money belonging to that person; and

(b)
every person declared by the Commissioner to be an agent or the sole agent of any person for any of the purposes of this Act.

assessable incomehas the meaning given by subsection
995-1(1)
of the
Income Tax Assessment Act 1997
.

assessmentmeans:

(a)
the ascertainment:

(i)
of the amount of taxable income (or that there is no taxable income); and

(ii)
of the tax payable on that taxable income (or that no tax is payable); and

(iii)
of the total of a taxpayer
'
s tax offset refunds for a year of income (or that the taxpayer can get no such refunds for the year of income); or

Note 1:

A taxpayer does not have a taxable income if the taxpayer
'
s deductions equal or exceed the taxpayer
'
s assessable income: see subsection
4-15(1)
of the
Income Tax Assessment Act 1997
.

Note 2:

A taxpayer may have no tax payable on an amount of taxable income if that income is below the tax-free threshold or if the taxpayer
'
s tax offsets reduce the taxpayer
'
s basic income tax liability to nil.

(b)
(Repealed by No 53 of 2016)

(c)
for a taxpayer that is the trustee of a unit trust that is a public trading trust (within the meaning of section
102R
)
-
the ascertainment:

(i)
of the net income of the trust (within the meaning of section
102M
) (or that there is no net income); and

(ii)
of the tax payable on that net income (or that no tax is payable); and

(iii)
of the total of a taxpayer
'
s tax offset refunds for a year of income (or that the taxpayer can get no such refunds for the year of income); or

(d)
for a taxpayer that is the trustee of a trust estate (other than a trustee to which paragraph (b) or (c) applies or the trustee of a complying superannuation fund, a non-complying superannuation fund, a complying approved deposit fund, a non-complying approved deposit fund or a pooled superannuation trust)
-
the ascertainment:

(i)
of so much of the net income of the trust estate as is net income in respect of which the trustee is liable to pay tax (or that there is no net income in respect of which the trustee is so liable); and

(ii)
of the tax payable on that net income (or that no tax is payable); and

(iii)
of the total of a taxpayer
'
s tax offset refunds for a year of income (or that the taxpayer can get no such refunds for the year of income); or

(e)
the ascertainment of the amount of interest payable under section
102AAM
(about distributions from non-resident trust estates); or

(f)
(Repealed by No 15 of 2017)

(g)
(Repealed by No 4 of 2018)

(h)
the ascertainment of the amount of income tax payable on the no-TFN contributions income as defined by section
295-610
of the
Income Tax Assessment Act 1997
(or that no tax is payable); or

(i)
(Repealed by No 70 of 2015)

(j)
the ascertainment of the amount payable (or that no amount is payable) under the following:

Definition of
"
assessment
"
amended by No 27 of 2017, s 3 and Sch 1 item 2, by inserting para (k), applicable in relation to DPT tax benefits for a year of income that starts on or after 1 July 2017 (whether or not the DPT tax benefit arises in connection with a scheme that was entered into, or was commenced to be carried out, before 1 July 2017).

Definition of
"
assessment
"
amended by No 53 of 2016, s 3 and Sch 5 item 6, by repealing para (b), applicable to assessments for income years starting on or after 1 July 2016. For transitional provision, see note under Pt III Div
6B
heading. Para (b) formerly read:

(b)
for a taxpayer that is the trustee of a unit trust that is a corporate unit trust (within the meaning of section 102J)
-
the ascertainment:

(i)
of the net income of the trust (within the meaning of section 102D) (or that there is no net income); and

(ii)
of the tax payable on that net income (or that no tax is payable); and

(iii)
of the total of the taxpayer
'
s tax offset refunds for a year of income (or that the taxpayer can get no such refunds for the year of income); or

(i)
the ascertainment of an amount of FHSA misuse tax (within the meaning of the
Income Tax Assessment Act 1997
) (or that no tax is payable).

Definition of
"
assessment
"
amended by No 88 of 2013, s 3 and Sch 5 item 11, by substituting paras (a) to (d), applicable to assessments made on or after 1 July 2013 for the 2013-14 income year or later income years. The paras formerly read:

(a)
the ascertainment of the amount of taxable income (or that there is no taxable income) and of the tax payable on that taxable income (or that no tax is payable); or

Note 1:

A taxpayer does not have a taxable income if the taxpayer
'
s deductions equal or exceed the taxpayer
'
s assessable income: see subsection
4-15(1)
of the
Income Tax Assessment Act 1997
.

Note 2:

A taxpayer may have no tax payable on an amount of taxable income if that income is below the tax-free threshold or if the taxpayer
'
s tax offsets reduce the taxpayer
'
s basic income tax liability to nil.

(b)
for a taxpayer being the trustee of a unit trust that is a corporate unit trust within the meaning of section
102J
-
the ascertainment of the net income of the trust as defined by section
102D
(or that there is no net income) and of the tax payable on that net income (or that no tax is payable); or

(c)
for a taxpayer being the trustee of a unit trust that is a public trading trust within the meaning of section
102R
-
the ascertainment of the net income of the trust as defined by section
102M
(or that there is no net income) and of the tax payable on that net income (or that no tax is payable); or

(d)
for any other taxpayer that is the trustee of a trust estate but excluding a taxpayer that is the trustee of a complying superannuation fund, a non-complying superannuation fund, a complying approved deposit fund, a non-complying approved deposit fund or a pooled superannuation trust
-
the ascertainment of so much of the net income of the trust estate as is net income in respect of which the trustee is liable to pay tax (or that there is no net income in respect of which the trustee is so liable) and of the tax payable on that net income (or that no tax is payable); or

Definition of
"
assessment
"
amended by No 45 of 2008, s 3 and Sch 1 item 2, by inserting para (i) at the end, effective 26 June 2008.

Definition of
"
assessment
"
amended by No 15 of 2007, s 3 and Sch 1 item 22, by substituting
"
a complying superannuation fund, a non-complying superannuation fund, a complying approved deposit fund, a non-complying approved deposit fund or a pooled superannuation trust
"
for
"
a fund or unit trust referred to in paragraph (a), (b) or (c) of the definition of
eligible entity
in subsection
267(1)
"
in para (d), applicable to the 2007-2008 income year and later years.

Definition of
"
assessment
"
amended by
No 9 of 2007
, s 3 and Sch 1 item 3, by inserting para (h), applicable to the 2007-2008 income year and later years.

Definition of
"
assessment
"
substituted by No 161 of 2005; amended by No 11 of 1999; No 169 of 1995; No 5 of 1991; No 20 of 1990 and No 123 of 1984.

childhas the meaning given by subsection
995-1(1)
of the
Income Tax Assessment Act 1997
.

Commissionermeans the Commissioner of Taxation.

Commonwealth education or training paymenthas the meaning given by subsection
995-1(1)
of the
Income Tax Assessment Act 1997
.

Commonwealth securitiesmeans bonds, debentures, stock or other securities issued under an Act, but does not include:

(a)
securities (not being securities to which paragraph (b) applies) issued in respect of a loan raised outside Australia unless there is in force a declaration by the Minister, published in the
Gazette
, that those securities shall be Commonwealth securities for the purposes of this Act; or

(a)
the total market value of the allocation represented by the ownership interests issued by the demerged entity in itself under a demerger to the owners of ownership interests in the head entity of the demerger group; or

(b)
the total market value of the allocation represented by the ownership interests disposed of by a member of a demerger group under a demerger to the owners of ownership interests in the head entity; or

Definition of
"
diverted profits tax
"
inserted by No 27 of 2017, s 3 and Sch 1 item 3, applicable in relation to DPT tax benefits for a year of income that starts on or after 1 July 2017 (whether or not the DPT tax benefit arises in connection with a scheme that was entered into, or was commenced to be carried out, before 1 July 2017).

dividendincludes:

(a)
any distribution made by a company to any of its shareholders, whether in money or other property; and

(b)
any amount credited by a company to any of its shareholders as shareholders;

(c)
(Repealed by No 63 of 1998)

but does not include:

(d)
moneys paid or credited by a company to a shareholder or any other property distributed by a company to shareholders (not being moneys or other property to which this paragraph, by reason of subsection (4), does not apply or moneys paid or credited, or property distributed for the redemption or cancellation of a redeemable preference share), where the amount of the moneys paid or credited, or the amount of the value of the property, is debited against an amount standing to the credit of the share capital account of the company; or

(e)
moneys paid or credited, or property distributed, by a company for the redemption or cancellation of a redeemable preference share if:

(i)
the company gives the holder of the share a notice when it redeems or cancels the share; and

(ii)
the notice specifies the amount paid-up on the share immediately before the cancellation or redemption; and

(iii)
the amount is debited to the company
'
s share capital account;

except to the extent that the amount of those moneys or the value of that property, as the case may be, is greater than the amount specified in the notice as the amount paid-up on the share; or

(f)
a reversionary bonus on a life assurance policy.

Note:

Subsection (4) sets out when paragraph (d) of this definition does not apply.

Definition of
"
dividend
"
amended by No 41 of 2011, s 3 and Sch 5 item 61, by inserting a note at the end, effective 27 June 2011.

Definition of
"
dividend
"
amended by No 83 of 2004, s 3 and Sch 1 item 108, by substituting
"
a life assurance policy
"
for
"
a policy of life-assurance
"
in para (f), applicable in relation to amounts received or derived by a taxpayer under or in relation to a life assurance policy after 25 June 2004.

Definition of
"
dividend
"
amended by No 63 of 1998; No 51 of 1973 and substituted by No 85 of 1967.

dividend (withholding) tax(Repealed by No 85 of 1967)

Division 230 financial arrangementhas the same meaning as in the
Income Tax Assessment Act 1997
.

Definition of
"
exploration credit
"
inserted by No 21 of 2015, s 3 and Sch 6 item 3, applicable in relation to the 2015-16, 2016-17 and 2017-18 income years, but not in relation to any later income years.

exploration development incentive tax offset(Repealed by No 15 of 2018)

exploration development incentive tax offsetmeans a tax offset under Subdivision 418-B of the
Income Tax Assessment Act 1997
.

Definition of
"
exploration development incentive tax offset
"
inserted by No 21 of 2015, s 3 and Sch 6 item 3, applicable in relation to the 2015-16, 2016-17 and 2017-18 income years, but not in relation to any later income years.

Families Secretaryhas the meaning given by the
Income Tax Assessment Act 1997.

(b)
that was established, and is maintained and applied, for the sole purpose of providing superannuation benefits for persons other than persons who are, or would ordinarily be or become, residents of Australia or residents of a Territory (even if pensions are paid out of the fund to the latter persons); and

(c)
the central management and control of which is carried on outside Australia by persons none of whom is a resident of Australia or a resident of a Territory;

not being a fund for which an amount has been set aside, or to which an amount has been paid, by a taxpayer that is an amount that has been allowed or is allowable as a deduction, or in respect of which a rebate of tax has been allowed or is allowable, under any provision of this Act.

Definition of
"
foreign superannuation fund
"
amended by
No 101 of 2006
, s 3 and Sch 2 items 125 and 126, by amending references to repealed inoperative provisions, and adding
"
(even if pensions are paid out of the fund to the latter persons)
"
after
"
Territory
"
in para (b), effective 14 September 2006. For application and savings provisions see the
CCH Australian Income Tax Legislation archive
.

Definition of
"
foreign superannuation fund
"
amended by No 181 of 1994, No 117 of 1975, No 216 of 1973 and inserted by No 85 of 1967.

friendly society dispensarymeans an approved pharmaceutical chemist within the meaning of Part VII of the
National Health Act 1953
, being a friendly society, or a friendly society body, within the meaning of that Part.

Definition of
"
friendly society dispensary
"
substituted by No 103 of 1983 and inserted by No 154 of 1981.

fringe benefithas the meaning given by subsection
995-1(1)
of the
Income Tax Assessment Act 1997
.

Note:

Definition of
"
full self-assessment taxpayer
"
amended by No 53 of 2016, s 3 and Sch 5 item 7, by repealing para (b), applicable to assessments for income years starting on or after 1 July 2016. For transitional provision, see note under Pt III Div
6B
heading. Para (b) formerly read:

(b)
the trustee of a trust that is a corporate unit trust in relation to the current year for the purposes of Division 6B of Part III;

Definition of
"
full self-assessment taxpayer
"
amended by No 88 of 2009, s 3 and Sch 5 item 306, by inserting para (g) at the end, applicable in relation to:

(a) the 2009-10 year of income; and

(b) later years of income.

Definition of
"
full self-assessment taxpayer
"
amended by No 15 of 2007, s 3 and Sch 1 item 28, by substituting paras (d), (e) and (f), applicable to the 2007-2008 income year and later years. Paras (d), (e) and (f) formerly read:

(d)
the trustee of a fund that is an eligible ADF (as defined in section
267
) in relation to the current year;

(e)
the trustee of a fund that is an eligible superannuation fund (as defined in section
267
) in relation to the current year;

(f)
the trustee of a fund that is a pooled superannuation trust (as defined in section
267
) in relation to the current year.

Definition of
"
full self-assessment taxpayer
"
inserted by No 179 of 1999.

fund paymenthas the same meaning as in the
Income Tax Assessment Act 1997
.

Definition of
"
general interest charge
"
amended by
No 101 of 2006
, s 3 and Sch 2 item 1023, by omitting the reference to a repealed inoperative division, effective 14 September 2006. For application and savings provisions see the
CCH Australian Income Tax Legislation archive
.

Definition of
"
general interest charge
"
inserted by No 11 of 1999.

general partnerhas the meaning given by subsection
995-1(1)
of the
Income Tax Assessment Act 1997
.

income from personal exertionor
income derived from personal exertion
means income consisting of earnings, salaries, wages, commissions, fees, bonuses, pensions, superannuation allowances, retiring allowances and retiring gratuities, allowances and gratuities received in the capacity of employee or in relation to any services rendered, the proceeds of any business carried on by the taxpayer either alone or as a partner with any other person, any amount received as a bounty or subsidy in carrying on a business, any amount that is included in the assessable income of the taxpayer by reason of section
393-10
of the
Income Tax Assessment Act 1997
, the income from any property where that income forms part of the emoluments of any office or employment of profit held by the taxpayer, and any profit arising from the sale by the taxpayer of any property acquired by the taxpayer for the purpose of profit-making by sale or from the carrying on or carrying out of any profit-making undertaking or scheme, but does not include:

(a)
interest, unless the taxpayer
'
s principal business consists of the lending of money, or unless the interest is received in respect of a debt due to the taxpayer for goods supplied or services rendered by the taxpayer in the course of the taxpayer
'
s business; or

Definition of
"
income from personal exertion
"
or
"
income derived from personal exertion
"
amended by No 41 of 2011, s 3 and Sch 5 Pt 27, by removing gender-specific language, effective 27 June 2011.

Definition of
"
income from personal exertion
"
or
"
income derived from personal exertion
"
amended by
No 79 of 2010
, s 3 and Sch 4 item 11, by substituting
"
section 393-10 of the
Income Tax Assessment Act 1997
"
for
"
section 393-15 of Schedule 2G
"
, effective 1 July 2010.

Definition of
"
income from personal exertion
"
or
"
income derived from personal exertion
"
amended by
No 101 of 2006
, s 3 and Sch 2 item 130, by amending references to repealed inoperative provisions, effective 14 September 2006. For application and savings provisions see the
CCH Australian Income Tax Legislation archive
.

Definition of
"
income from personal exertion
"
or
"
income derived from personal exertion
"
amended by No 163 of 2001.

Definition of
"
income from personal exertion
"
or
"
income derived from personal exertion
"
amended by No 85 of 1998; No 138 of 1994; No 205 of 1976 and No 126 of 1974.

income from propertyor
income derived from property
means all income not being income from personal exertion.

income taxmeans income tax imposed as such by any Act, as assessed under this Act, but, except in section
260
, does not include mining withholding tax or withholding tax.

Definition of
"
income tax or tax
"
repealed by No 110 of 2014, s 3 and Sch 5 item 95, effective 16 October 2014. The definition formerly read:

income tax or taxmeans income tax imposed as such by any Act, as assessed under this Act, but, except in section
260
, does not include mining withholding tax or withholding tax.

Definition of
"
income tax
"
or
"
tax
"
amended by
No 101 of 2006
, s 3 and Sch 2 item 131, by adding
"
, but, except in section 260, does not include mining withholding tax or withholding tax
"
after
"
this Act
"
, effective 14 September 2006. For application and savings provisions see the
CCH Australian Income Tax Legislation archive
.

Definition of
"
income tax
"
or
"
tax
"
substituted by No 39 of 1997.

Indigenous landhas the same meaning as in the
Income Tax Assessment Act 1997
.

insurance funds, in relation to a company, means all the Australian statutory funds of the company and all other funds maintained by the company in respect of the life assurance business of the company.

Definition of
"
insurance funds
"
substituted by No 41 of 2005; inserted by No 89 of 2000.

interest income, in relation to a taxpayer, means income consisting of interest, or a payment in the nature of interest, in respect of:

(a)
money lent, advanced or deposited; or

(b)
credit given; or

(c)
any other form of debt or liability;

whether security is given or not, other than:

(d)
an amount to the extent to which it is a return on an equity interest in a company; or

(e)
interest derived by the taxpayer from a transaction directly related to the active conduct of a trade or business; or

(f)
interest derived by the taxpayer from carrying on a banking business or any other business whose income is principally derived from the lending of money; or

(g)
interest received by the taxpayer during a year of income from a foreign company, where:

(i)
at any time during the year of income, the taxpayer had (or would have had, if the taxpayer were a company and a resident), a voting interest, within the meaning of section
334A
, amounting to at least 10% of the voting power, within the meaning of that section, in that company; and

(ii)
during the year of income or the preceding year of income, the company has not derived an amount of interest income exceeding 10% of the total profits derived by the company during the same year.

Definition of
"
interest income
"
inserted by
No 143 of 2007
, s 3 and Sch 1 item 18, applicable in relation to income years, statutory accounting periods and notional accounting periods starting on or after the first 1 July that occurs after 24 September 2007.

Definition of
"
intermediary
"
repealed by
No 32 of 2008
, s 3 and Sch 1 item 4, applicable to fund payments made in relation to the first income year starting on or after the first 1 July after 23 June 2008 and later income years. The definition formerly read:

intermediaryhas the same meaning as in the
Income Tax Assessment Act 1997
.

Definition of
"
intermediary
"
inserted by
No 79 of 2007
, s 3 and Sch 10 item 4, applicable to the first income year starting on or after the first 1 July after 21 June 2007 and later income years.

Definition of
"
international tax sharing treaty
"
repealed by No 101 of 2013, s 3 and Sch 2 item 8, applicable: (a) in respect of tax other than withholding tax
-
in relation to income years starting on or after the date mentioned in subsection
815-15(2)
of the
Income Tax (Transitional Provisions) Act 1997
, as inserted; and (b) in respect of withholding tax
-
in relation to income derived, or taken to be derived, in income years starting on or after that date. The definition formerly read:

international tax sharing treaty
:

(a)
means an agreement between Australia and another country under which Australia and the other country share tax revenues from activities undertaken in an area identified by or under the agreement; and

(b)
does not include an agreement within the meaning of the
International Tax Agreements Act 1953
.

Definition of
"
limited partner
"
substituted by No 83 of 2004, s 3 and Sch 3 item 1, applicable to things done on or after 2 December 2003. Act No 83 of 2004, s 3 and Sch 3 item 7 also contains the following transitional provision:

7 Transitional
(1)
This item applies to a limited partnership:

(a)
that was formed as a legal entity on or after 2 December 2003 and before the day on which this Act received the Royal Assent; and

(b)
in respect of which an application has been made to the PDF Board for registration as a VCLP or an AFOF under the
Venture Capital Act 2002
; and

(c)
that could not be registered or conditionally registered as a VCLP or an AFOF before the day on which this Act received the Royal Assent only because it has a legal personality separate from that of its members.
(2)
If the PDF Board decided, before the day on which this Act received the Royal Assent, that it would have registered or conditionally registered a limited partnership to which this item applies as a VCLP or an AFOF under the
Venture Capital Act 2002
had this Act received the Royal Assent before that decision was made:

(a)
the PDF Board is taken to have granted registration or conditional registration of the limited partnership as a VCLP or an AFOF under that Act on the day on which that decision was made; and

(b)
that registration is taken to have been in force for the purposes of section 13-10 of that Act from that day.

The definition formerly read:

limited partnermeans a partner of a limited partnership whose liability in relation to the partnership is limited.

Definition of
"
limited partner
"
inserted by No 136 of 2002, s 3 and Sch 2 item 3, applicable to the 2002-2003 income year and later income years.

limited partnershiphas the same meaning as in the
Income Tax Assessment Act 1997
.

Definition of
"
limited partnership
"
substituted by No 83 of 2004, s 3 and Sch 3 item 2, applicable to things done on or after 2 December 2003. For transitional provision, see note under definition of
"
limited partner
"
. The definition formerly read:

limited partnershipmeans a partnership where the liability of at least one of the partners is limited.

Definition of
"
limited partnership
"
inserted by No 136 of 2002, s 3 and Sch 2 item 4, applicable to the 2002-2003 income year and later income years.

liquidatormeans the person who, whether or not appointed as liquidator, is the person required by law to carry out the winding-up of a company.

Definition of
"
loss carry back tax offset
"
repealed by No 96 of 2014, s 3 and Sch 2 item 3, effective 30 September 2014 and applicable to assessments for the income year before the income year in which this Schedule commences, for the income year in which this Schedule commences and for later income years. For transitional and saving provision see note under s
177C(1)
. The definition formerly read:

loss carry back tax offsethas the same meaning as in the
Income Tax Assessment Act 1997
.

Definition of
"
managed investment trust
"
inserted by
No 79 of 2007
, s 3 and Sch 10 item 5, applicable to the first income year starting on or after the first 1 July after 21 June 2007 and later income years.

MEC grouphas the same meaning as in the
Income Tax Assessment Act 1997
.

member of a family tax benefit (Part B) family without shared care: a taxpayer is a
member of a family tax benefit (Part B) family without shared care
if:

(a)
the taxpayer, or the taxpayer
'
s spouse while being the taxpayer
'
s partner (within the meaning of the
A New Tax System (Family Assistance) Act 1999
), is eligible for family tax benefit at the Part B rate (within the meaning of that Act); and

(b)
clause
31
of Schedule
1
to that Act does not apply in respect of the Part B rate.

Definition of
"
necessary connection with Australia
"
repealed by
No 168 of 2006
, s 3 and Sch 4 item 14, applicable to CGT events that happen on or after 12 December 2006. The definition formerly read:

necessary connection with Australiahas the same meaning as in the
Income Tax Assessment Act 1997
.

Definition of
"
necessary connection with Australia
"
inserted by No 46 of 1998.

net capital gainhas the same meaning as in the
Income Tax Assessment Act 1997
.

non-equity sharemeans a share that is not an equity interest in the company.

Note:

A share will not be an equity interest if it is characterised as, or forms part of a larger interest that is characterised as, a debt interest under Subdivision
974-B
of the
Income Tax Assessment Act 1997
.

Definition of
"
non-equity share
"
inserted by No 163 of 2001. For application provisions, see note under s
6AB(5B)
.

Definition of
"
non-share equity interest
"
inserted by No 163 of 2001.

once-only deduction
:a deduction in a year of income in respect of a percentage of expenditure is a
once-only deduction
, in relation to the expenditure, if no deduction is allowable in respect of a percentage of the expenditure in any other year of income.

Definition of
"
outstanding claims
"
repealed by
No 79 of 2010
, s 3 and Sch 5 item 3, applicable to the first income year starting on or after 1 July 2010 and later income years. The definition formerly read:

outstanding claimsat the end of a year of income under general insurance policies issued by a general insurance company has the same meaning as in the
Income Tax Assessment Act 1997
.

Definition of
"
outstanding claims
"
inserted by No 97 of 2002.

over-franking taxhas the same meaning as in the
Income Tax Assessment Act 1997
.

Definition of
"
partnership
"
substituted by No 83 of 2004, s 3 and Sch 3 item 3, applicable to things done on or after 2 December 2003. For transitional provision, see note under definition of
"
limited partner
"
. The definition formerly read:

'partnership'
means an association of persons carrying on business as partners or in receipt of income jointly, but does not include a company;

passive commodity gain, in relation to a taxpayer, in relation to a year of income, means a gain realised by the taxpayer in a year of income from disposing of a forward contract or a futures contract, or a right or option in respect of a forward contract or a futures contract, in respect of any thing (a
commodity
):

(a)
that is capable of delivery under an agreement for its delivery; and

(b)
that is not an instrument creating or evidencing a chose in action;

unless the contract, right or option relates to the carrying on by the taxpayer of a business:

(c)
of producing or processing the commodity; or

(d)
that involves the use of the commodity as a raw material in a production process.

Definition of
"
passive commodity gain
"
inserted by
No 143 of 2007
, s 3 and Sch 1 item 19, applicable in relation to income years, statutory accounting periods and notional accounting periods starting on or after the first 1 July that occurs after 24 September 2007.

passive income, in relation to a taxpayer, in relation to a year of income means:

(a)
dividends (within the meaning of this section) and non-share dividends paid to the taxpayer in the year of income; or

(b)
unit trust dividends (within the meaning of Division
6C
) paid to the taxpayer in the year of income; or

(c)
a distribution made to the taxpayer in the year of income that is taken to be a dividend because of section
47
; or

(d)
an amount that is taken to be a dividend paid to the taxpayer in the year of income because of section
47A
or
108
or Division
7A
of Part
III
; or

(e)
interest income derived by the taxpayer in the year of income; or

(f)
annuities derived by the taxpayer in the year of income; or

(g)
income derived by the taxpayer by way of rent (within the meaning of Part
X
) in the year of income; or

(h)
royalties derived by the taxpayer in the year of income; or

(i)
an amount derived by the taxpayer in the year of income as consideration for the assignment, in whole or in part, of any copyright, patent, design, trade mark or other like property or right; or

(j)
profits of a capital nature that accrued to the taxpayer in the year of income; or

(k)
passive commodity gains that accrued to the taxpayer in the year of income; or

(l)
an amount included in the assessable income of the taxpayer of the year of income under section
102AAZD
,
456
,
457
or
459A
;

but does not include:

(m)
an amount that arose from an asset necessarily held by the taxpayer in connection with an insurance business actively carried on by the taxpayer; or

(n)
an amount included in the taxpayer
'
s assessable income under Division
83A
of the
Income Tax Assessment Act 1997
(about employee share schemes).

Definition of
"
passive income
"
amended by No 53 of 2016, s 3 and Sch 5 item 8, by omitting
"
6B or
"
before
"
6C
"
from para (b), applicable to assessments for income years starting on or after 1 July 2016. For transitional provision, see note under Pt III Div
6B
heading.

Definition of
"
passive income
"
amended by No 114 of 2010, s 3 and Sch 1 item 2, by substituting
"
or 459A
"
for
"
, 459A or 529
"
in para (l), applicable in relation to the 2010-11 year of income for a taxpayer and later years of income.

Definition of
"
passive income
"
amended by No 133 of 2009, s 3 and Sch 1 item 9, by substituting
"
Division 83A of the
Income Tax Assessment Act 1997
(about employee share schemes)
"
for
"
Division
13A
"
in para (n), applicable in relation to the ESS interests mentioned in subsections
83A-5(1)
and
(2)
of the
Income Tax (Transitional Provisions) Act 1997
.

Definition of
"
passive income
"
inserted by
No 143 of 2007
, s 3 and Sch 1 item 20, applicable in relation to income years, statutory accounting periods and notional accounting periods starting on or after the first 1 July that occurs after 24 September 2007.

PDF(pooled development fund) means a company that is a PDF within the meaning of the
Pooled Development Funds Act 1992
, but does not include such a company in the capacity of a trustee.

permanent establishment
,in relation to a person (including the Commonwealth, a State or an authority of the Commonwealth or a State), means a place at or through which the person carries on any business and, without limiting the generality of the foregoing, includes:

(a)
a place where the person is carrying on business through an agent;

(b)
a place where the person has, is using or is installing substantial equipment or substantial machinery;

(c)
a place where the person is engaged in a construction project; and

(d)
where the person is engaged in selling goods manufactured, assembled, processed, packed or distributed by another person for, or at or to the order of, the first-mentioned person and either of those persons participates in the management, control or capital of the other person or another person participates in the management, control or capital of both of those persons
-
the place where the goods are manufactured, assembled, processed, packed or distributed;

but does not include:

(e)
a place where the person is engaged in business dealings through a
bona fide
commission agent or broker who, in relation to those dealings, acts in the ordinary course of his or her business as a commission agent or broker and does not receive remuneration otherwise than at a rate customary in relation to dealings of that kind, not being a place where the person otherwise carries on business;

(f)
a place where the person is carrying on business through an agent:

(i)
who does not have, or does not habitually exercise, a general authority to negotiate and conclude contracts on behalf of the person; or

(ii)
whose authority extends to filling orders on behalf of the person from a stock of goods or merchandise situated in the country where the place is located, but who does not regularly exercise that authority;

not being a place where the person otherwise carries on business; or

(g)
a place of business maintained by the person solely for the purpose of purchasing goods or merchandise.

Note:

Subsection (6) treats a person as carrying on, at or through a permanent establishment that is a place described in paragraph (d) of this definition, the business of selling the goods manufactured, assembled, processed, packed or distributed by the other person as described in that paragraph.

Definition of
"
post FIF abolition surplus
"
inserted by No 114 of 2010, s 3 and Sch 1 item 5, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income.

prescribed dual residentmeans a company that satisfies either of the following conditions:

(a)
the first condition is that:

(i)
the company is a resident of Australia within the meaning of subsection
6(1)
; and

(ii)
there is an agreement (within the meaning of the
International Tax Agreements Act 1953
) in force in respect of a foreign country; and

(iii)
the agreement contains a provision that is expressed to apply where, apart from the provision, the company would, for the purposes of the agreement, be both a resident of Australia and a resident of the foreign country; and

(iv)
that provision has the effect that the company is, for the purposes of the agreement, a resident solely of the foreign country;

(b)
the alternative condition is that the company:

(i)
is a resident of Australia within the meaning of subsection
6(1)
for no other reason than that it carries on business in Australia and has its central management and control in Australia; and

Definition of
"
primary production business
"
inserted by
No 101 of 2006
, s 3 and Sch 2 item 135, effective 14 September 2006. For application and savings provisions see the
CCH Australian Income Tax Legislation archive
.

principal beneficiaryof a special disability trust has the same meaning as in the
Income Tax Assessment Act 1997
.

Definition of
"
rebatable medical expense amount
"
inserted by No 84 of 2013, s 3 and Sch 5 item 5, applicable to assessments for the 2012-13 year of income and later years of income.

rebate incomeof an individual for a year of income is the sum of:

(a)
the individual
'
s taxable income for the year of income, disregarding the individual
'
s assessable FHSS released amount (within the meaning of the
Income Tax Assessment Act 1997
) for the year of income; and

(b)
the individual
'
s reportable superannuation contributions for the year of income; and

(c)
the individual
'
s total net investment loss for the year of income; and

(d)
the individual
'
s adjusted fringe benefits total for the year of income.

Definition of
"
rebate income
"
amended by No 132 of 2017, s 3 and Sch 1 item 26, by inserting
"
, disregarding the individual
'
s assessable FHSS released amount (within the meaning of the
Income Tax Assessment Act 1997
) for the year of income
"
in para (a), effective 1 July 2018.

Definition of
"
rebate income
"
inserted by No 27 of 2009, s 3 and Sch 3 item 2, applicable in relation to income years starting on or after 1 July 2009.

Definition of
"
reportable fringe benefits total
"
substituted by No 27 of 2009, s 3 and Sch 3 item 3, applicable in relation to income years starting on or after 1 July 2009. The definition formerly read:

reportable fringe benefits totalfor a year of income for a person who is an employee (within the meaning of the
Fringe Benefits Tax Assessment Act 1986
) means the employee
'
s reportable fringe benefits total (as defined in that Act) for the year of income.

Definition of
"
reportable fringe benefits total
"
inserted by No 17 of 1999.

reportable superannuation contributionshas the same meaning as in the
Income Tax Assessment Act 1997
.

Definition of
"
Research Secretary
"
inserted by No 88 of 2009, s 3 and Sch 5 item 43, effective 18 September 2009.

residentor
resident of Australia
means:

(a)
a person, other than a company, who resides in Australia and includes a person:

(i)
whose domicile is in Australia, unless the Commissioner is satisfied that the person
'
s permanent place of abode is outside Australia;

(ii)
who has actually been in Australia, continuously or intermittently, during more than one-half of the year of income, unless the Commissioner is satisfied that the person
'
s usual place of abode is outside Australia and that the person does not intend to take up residence in Australia; or

(iii)
who is:

(A)
a member of the superannuation scheme established by deed under the
Superannuation Act 1990
; or

(B)
an eligible employee for the purposes of the
Superannuation Act 1976
; or

(C)
the spouse, or a child under 16, of a person covered by sub-subparagraph (A) or (B); and

(b)
a company which is incorporated in Australia, or which, not being incorporated in Australia, carries on business in Australia, and has either its central management and control in Australia, or its voting power controlled by shareholders who are residents of Australia.

royaltyor
royalties
includes any amount paid or credited, however described or computed, and whether the payment or credit is periodical or not, to the extent to which it is paid or credited, as the case may be, as consideration for:

(a)
the use of, or the right to use, any copyright, patent, design or model, plan, secret formula or process, trade mark, or other like property or right;

(b)
the use of, or the right to use, any industrial, commercial or scientific equipment;

(c)
the supply of scientific, technical, industrial or commercial knowledge or information;

(d)
the supply of any assistance that is ancillary and subsidiary to, and is furnished as a means of enabling the application or enjoyment of, any such property or right as is mentioned in paragraph (a), any such equipment as is mentioned in paragraph (b) or any such knowledge or information as is mentioned in paragraph (c);

(da)
the reception of, or the right to receive, visual images or sounds, or both, transmitted to the public by:

(i)
satellite; or

(ii)
cable, optic fibre or similar technology;

(db)
the use in connection with television broadcasting or radio broadcasting, or the right to use in connection with television broadcasting or radio broadcasting, visual images or sounds, or both, transmitted by:

(i)
satellite; or

(ii)
cable, optic fibre or similar technology;

(dc)
the use of, or the right to use, some or all of the part of the spectrum (within the meaning of the
Radiocommunications Act 1992
) specified in a spectrum licence issued under that Act;

(e)
the use of, or the right to use:

(i)
motion picture films;

(ii)
films or video tapes for use in connexion with television; or

(iii)
tapes for use in connexion with radio broadcasting; or

(f)
a total or partial forbearance in respect of:

(i)
the use of, or the granting of the right to use, any such property or right as is mentioned in paragraph (a) or any such equipment as is mentioned in paragraph (b);

(ii)
the supply of any such knowledge or information as is mentioned in paragraph (c) or of any such assistance as is mentioned in paragraph (d);

(iia)
the reception of, or the granting of the right to receive, any such visual images or sounds as are mentioned in paragraph (da);

(iib)
the use of, or the granting of the right to use, any such visual images or sounds as are mentioned in paragraph (db);

(iic)
the use of, or the granting of the right to use, some or all of such part of the spectrum specified in a spectrum licence as is mentioned in paragraph (dc); or

(iii)
the use of, or the granting of the right to use, any such property as is mentioned in paragraph (e).

Definition of
"
share capital account
"
substituted by
No 80 of 2006
, s 3 and Sch 4 item 21, applicable for the purpose of determining whether an account is a share capital account when applying a provision of the
Income Tax Assessment Act 1997
or the
Income Tax Assessment Act 1936
in relation to a time that is after 30 June 2006, even if the account was in existence before that date. The definition formerly read:

trusteein addition to every person appointed or constituted trustee by act of parties, by order, or declaration of a court, or by operation of law, includes:

(a)
an executor or administrator, guardian, committee, receiver, or liquidator; and

(b)
every person having or taking upon himself the administration or control of income affected by any express or implied trust, or acting in any fiduciary capacity, or having the possession, control or management of the income of a person under any legal or other disability.

unfranked partof a distribution has the same meaning as in the
Income Tax Assessment Act 1997
.

Definition of
"
value of the outstanding claims liability
"
repealed by
No 79 of 2010
, s 3 and Sch 5 item 4, applicable to the first income year starting on or after 1 July 2010 and later income years. The definition formerly read:

value of the outstanding claims liabilityof a general insurance company under general insurance policies has the meaning given by section 321-20 in Schedule 2J.

Definition of
"
value of the outstanding claims liability
"
inserted by No 97 of 2002.

Definition of
"
value of the unearned premium reserve
"
repealed by
No 79 of 2010
, s 3 and Sch 5 item 5, applicable to the first income year starting on or after 1 July 2010 and later income years. The definition formerly read:

value of the unearned premium reserveof a general insurance company under general insurance policies has the meaning given by section
321-60
in Schedule
2J
.

Definition of
"
value of the unearned premium reserve
"
inserted by No 97 of 2002.

VCLPmeans a venture capital limited partnership within the meaning of subsection
118-405(2)
of the
Income Tax Assessment Act 1997
.

Definition of
"
withholding tax
"
substituted by No 15 of 2007, s 3 and Sch 1 item 36, applicable to the 2007-2008 income year and later years. The definition formerly read:

withholding taxmeans income tax payable in accordance with section
27GA
or
128B
.

Definition of
"
withholding tax
"
amended by No 15 of 2002; No 51 of 1973 and inserted by No 85 of 1967.

work and income support related withholding payments and benefitsmeans:

(a)
payments from which an amount:

(i)
must be withheld under a provision of Subdivision 12-B (other than section
12-55
), 12-C or 12-D or Division 13 in Schedule 1 to the
Taxation Administration Act 1953
(even if the amount is not withheld); or

(ii)
would be required to be withheld under a provision mentioned in subparagraph (i) (other than section
12-55
) apart from subsection
12-1(1A)
in Schedule
1
to that Act; and

(b)
amounts included in a person
'
s assessable income under section
86-15
of the
Income Tax Assessment Act 1997
in respect of which an amount must be paid under Division
13
in Schedule
1
to the
Taxation Administration Act 1953
(even if the amount is not paid); and

(c)
non-cash benefits in relation to which the provider of the benefit must pay an amount to the Commissioner under Division
14
in Schedule
1
to the
Taxation Administration Act 1953
(even if the amount is not paid).

Note:

The payments covered by paragraph (a) are: payments to employees and company directors, payments to office holders, return to work payments, payments under labour hire arrangements, payments of annuities, superannuation benefits, payments for termination of employment, payments for unused leave, benefit payments, compensation payments and payments specified by regulations.

Definition of
"
work and income support related withholding payments and benefits
"
amended by No 56 of 2010, s 3 and Sch 6 item 55, by substituting
"
payments for termination of employment,
"
for
"
employment termination payments,
"
in the note, effective 3 June 2010.

(a)
payments from which an amount must be withheld under a provision of Subdivision
12-B
(other than section
12-55
),
12-C
or
12-D
in Schedule
1
to the
Taxation Administration Act 1953
(even if the amount is not withheld); and

Definition of
"
work and income support related withholding payments and benefits
"
inserted by No 101 of 2006. For application and savings provisions see the CCH Australian Income Tax Legislation archive.

year of incomemeans an income year as defined in subsection
995-1(1)
of the
Income Tax Assessment Act 1997
.

6(2)
Unless the contrary intention appears, any reference in this Act (including subsection (2A) of this section) to a year of income commencing or ending on a specified date shall be deemed to include, in relation to a taxpayer who has adopted, or who is deemed to have adopted, under this Act, an accounting period in lieu of that year of income, a reference to:

The Commissioner may, by legislative instrument, make a determination modifying the operation of one or more provisions of this Act in relation to limited partnerships whose accounting periods commence or end under section
18A
of the
Income Tax Assessment Act 1936
.

6(2A)
A reference in this Act to a year of income preceded by a figure referring to 2 years is a reference to the year of income commencing on 1 July in the first of those years (for example,
1990-91 year of income
refers to the year of income commencing on 1 July 1990).

Paragraph (d) of the definition of
dividend
in subsection (1) does not apply if, under an arrangement:

(a)
a person pays or credits any money or gives property to the company and the company credits its share capital account with the amount of the money or the value of the property; and

(b)
the company pays or credits any money, or distributes property to another person, and debits its share capital account with the amount of the money or the value of the property so paid, credited or distributed.

Where a place is, by virtue of paragraph (d) of the definition of
permanent establishment
in subsection (1), a permanent establishment of a person, the person shall, for the purposes of this Act, be deemed to be carrying on at or through that permanent establishment the business of selling the goods manufactured, assembled, processed, packed or distributed by the other person at the place that is that permanent establishment.

Archived:

S 6(7) to (8) repealed as inoperative by
No 101 of 2006
, s 3 and Sch 1 item 33, effective 14 September 2006. For
application and savings provisions
and for former wording see the
CCH Australian Income Tax Legislation archive
.

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